Scottish & Southern Energy cuts bills

Scottish & Southern Energy has announced reductions in standard tariff gas bills from the end of the month, becoming the second major supplier to cut prices this year.

Reductions: The avwerage SSE customer will save £30.

The provider, which serves nearly 10m customers across gas and electricity in total, said the reduction would come into effect from March 29.

But the group is increasing the 'fixed' charge element of bills, which could see some low usage gas customers fail to fully benefit from the price cut.

SSE said gas bills for those in England and Wales using the typical amount of gas will reduce by 4%, or £30, on average, while it has also removed the extra charges levied for 'single' fuel gas customers that will see their bills drop by an average of 7%, or £56.

Pre-payment gas customers will benefit from an average reduction of 9% or £70, although typical pre-payment bills in Scotland will go down by 11%.

The announcement comes after British Gas cut its standard gas bills by 10% last month - the first of the 'big six' energy groups to reduce tariffs since last year.

There have been calls for widespread energy cuts after bumper annual profits revealed by major players in recent weeks. Centrica said its residential British Gas arm notched up a 58% leap in profits last year, while Scottish Power's earnings rose by 7.9%.

SSE said today its changes will see the fixed amount charged for the first 1,143kWh of gas used rise from £53 to £98, including VAT. Gas used beyond this level will be reduced by at least 11%, giving a net effect of a 4% reduction in the typical bill, according to SSE.

After these changes, the average 'dual fuel' standard credit bill will be £1,162 a year, it added.

Market watchers said the change provided further evidence that all households should see their bills come down in the near future.

Ann Robinson, Director of Consumer Policy at uSwitch.com, says: 'This is great news for consumers – at the moment it's just a two horse race, but today's move should tip the balance in favour of more suppliers joining the field with price cuts of their own.

'The fact that the country's two biggest suppliers have acted to bring their prices down will put more pressure on the remaining four suppliers to do the same, but there are still no guarantees.'